It was an unusual move that stood the normal process on its head, was done without legislative review or endorsement, and soon raised outcry from surprised service providers elsewhere across the state.

Some upset with the move said the increased payments violated the state’s contract with service providers. Others have questioned whether the arrangement complies with the state’s Medicaid plan and in protests to SRS even suggested it might be “Medicaid fraud.”

The original allegations were made in March 2009 at the time Kathleen Sebelius was under consideration to become Health and Human Services Secretary in the Obama administration.

“I’m sorry that there have been other hearings on this, and it keeps raising its ugly head,” said Sen. Lynn as part of her grilling of Jordan:

“The fact that the money came from an administrative fund in very tight times, and the fact that it just went to one agency … it just smells bad …”

“In view of the fact that there were other CDDOs [Community Developmental Disability Organizations] that did not receive $700,000 additional, when they are out there slogging it out everyday with people that need extraordinary funding, and this award is made to one agency, without documentation, that a significant thing has happened. It’s not just a violation of trust on their part; I think it’s a violation of the public trust. That is the most serious thing that came out of this. …

“The fact of the matter is from where I sit the proper channels were not utilized, it looked like and it appeared to many that this was done behind closed doors with a board member … and the governor [Sebelius]. You three people got in a room and made a deal and that’s exactly what it looks like. That’s why it doesn’t smell good. That’s why there appears to be a trust issue …”

“I see the fact there were 4000 people on a waiting list, that we have had people here in this Capitol pounding on our doors and chanting in the halls, and that we have not funded them fully like we should. That was happening simultaneously when this $700,000 payment was made. I think that’s part of what the political ramifications of that decision made in a room created.”

“I made the decision … because I thought it was the right thing to do …”

“The way we did it was a little different …”

“In retrospect I would not do that again because of all the stink it raised. “I wasn’t trying to hide anything …”

“I really don’t know what else there is to do on my part …”

“I understand there is a disagreement. I did in fact have the authority to do it. It didn’t go to line anyone else’s pockets …it was done to try to keep individuals with significant disability needs in service. “

“I accept that a lot of people disagreed with the decision I made and it will obviously affect future decisions I make …”

“I would hope that for our common clients that we would all just get back to work.

Jordan responded that he had done nothing to increase the waiting list, and services were not taken from anyone else. Jordan said he knew a lot of CDDOs had been very offended by his action, but he explained “we need to have mature relationships … for the good of the system we need to let bygones be bygones and move on”.

Haley replied, “I continue to trust you implicitly on any of the decisions that you make.”

This dispute is not about the decision of a Community Service Provider to circumvent the rules, but about the Secretary of SRA agreeing to deviate from the standard, overriding contract and policy.

Staff from the Legislative Post Audit Division earlier described selected issues related to state contracts for foster care. One of the issues discussed was how some groups, like The Farm in Emporia, used multiple non-profits for various purposes.

Legislative post audit did not mention the multiple non-profits used by CLO in Lenexa. The Kansas Watchdog has studied the three CLO non-profits and does not understand their purpose.

The discussion of contracting irregularities was the final topic of the two-day meeting by the Joint Committee on Children’s Issues on Nov 30 and Dec 1.